Given that all countries have the same Cobb-Douglas production function, i.e. Y/N = (K/N)b, where b = 0.5, then a ten-fold difference in per capita income requires a difference in capital per capita by a factor of
A) 10.
B) 100.
C) 1000.
D) 10,000.
B
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How can the multiplier help macroeconomic policymakers determine how much additional investment or government purchases are necessary to reach full employment?
What will be an ideal response?
Lenders are typically compensated for the risk of default with
A. Shares of the company's profits. B. Above-average interest rates. C. Dividend payments. D. Bonds.
In 2017 inflation adjusted U.S. poverty threshold was
A. An annual income of less than $10,000 for a family of two. B. The cost of food and shelter but not other necessities for an individual. C. An annual income of less than $25,000 for a family of four. D. The dollar measure of output produced by an individual.
Assume all of the information from Question #11 above: If Willy actually does install the extra safety equipment, it will cost him $20,000 to do so. Based on this new information about its cost, will Willy be willing to install the new equipment?
A. Yes, because it costs him less than it is worth. B. Yes, because it costs him more than it is worth. C. No, because it costs him more than it is worth. D. No, because it costs him less than it is worth.